Archive » August 6, 2009

WILLIAMSON ACT CONTRACTS TO REMAIN UNCHANGED, SAY COUNTY OFFICIALS

Long presumed to become a casualty of the state’s financial crisis, Williamson Act subvention was gutted last week by the governor, but county leaders say they will continue to fund current contracts and extend new ones into the future.

“The good news is
that the program was not eliminated,” said 3rd District Supervisor Doreen Farr
on Friday. “It means that the next year or the following year, when the state
budget or the economy improves, the money can be put back into the program.”

Established in the 1960s, the Williamson Act grants
landowners lower property tax rates, if they agree to keep their land in
agriculture for at least 10 years. The program covers 16.9 million acres of
farmland statewide, including 550,000 acres in Santa Barbara County or about 75
percent of all local agricultural land.

The county is among the top 10 in California with the
largest one-year enrollment increases, according to a 2008 Williamson Act
Status report by the California Department of Conservation.

Because funding from the state has been tenuous in the
past, the county did not budget for the dollars it generally gets from the
state. Consequently, landowners under such contracts will see no change in tax
breaks, Farr said.

Bill Gillette, the county’s agriculture commissioner,
said the county is not likely to eliminate the program because the state only
compensates the county with $640,000 for local losses in property taxes — about
$13 million annually.

The reimbursement amount is based on a formula created in
1971 that pays the county $1 for every acre of pasture land and $5 for every
acre of cultivated land, he said.

“The fear would be that the county becomes desperate for
funds over time,” Gillette said.

Williamson Act funding has been off and on the chopping
block for years. Back in mid-June, before the governor whittled down the act’s
budget to a token $1,000, the state Assembly’s Budget Committee had voted to
suspend the subventions, but that agreement dissolved after protests from the committee’s
vice chairman, Assemblyman Jim Nielsen, who brokered a 20 percent cut
compromise.

It is still unknown if the Williamson Act funds will be
reinstated next year, but if the cuts turn out to be permanent, some fear that
they would severely curtail agriculture in the county and across the state.

Kevin Merrell, a board member of the Santa Barbara County
Farm Bureau, said axing the Williamson Act would devastate agriculture because
“sky high” land values would force many ranchers and farmers across the state
and county to develop.

“The Legislature is good at coming up with regulations
for farmers to follow,” Merrell said sarcastically. “So while our competitors
across the world have been supported with tax breaks, we’re scrambling to stay
in business in a worldwide market with countries that recognize that
agriculture is viable,” he said. “It’s just one more thing on the backs of
farmers that leaves them to ask, ‘How am I going to keep going?’ “

Bill Giorgi, a local rancher
who has land under a Williamson Act contract, said eliminating the act would be
a “deathblow” to grazing and pasture land.

Giorgi,
who sits on the land-use committee for the Santa Barbara Cattlemen’s
Association, said cattlemen and cattlewomen, who require large swaths of land
for ranching, see small profit margins, and losing the tax benefits they get
from the Williamson Act could put many out of business.

Such sentiments are supported by a 1990 survey that
gauged the importance of the act to participating landowners. It found that one
in three landowners who participate in the Williamson Act program would be
unable to continue farming or ranching without the benefits of the program.

“Those figures would still be accurate today,” said John Gamper, director of taxation and land use for the
California Farm Bureau Federation.” A lot of those farmers are still in
business, and they’d look back and say were it not for the Williamson Act, in
those lean years the cost of their property taxes would have put them out of
business.”

Los Olivos rancher Willy
Chamberlin called the governor’s move “short-sighted,” but he wasn’t the least
concerned that the county would do away with Williamson contracts.

“I don’t believe they’re going to throw us to the wolves
because if our property taxes go up too high, we’ll sell our land and make it
into smaller parcels to sell it,” he said. “The county has lost some money, but
if land is sold into smaller, agricultural parcels, there would be more people
and more services the county would have to budget for.

“On top of that, there will be less open space, something
people in this county do not want to see happen. There’d be a snowballing
effect for the worst.”

Santa Barbara County is a mixture of rural and urban
land, but unlike some other counties that have been gobbled up during the
housing boom, the region, especially the North County, is firmly entrenched in
agriculture, a $1 billion industry employing about 1,700 people each year.

Gillette said that even if the county eliminated the
program or suspended it to shore up recessionary budget cuts,
it would not get an immediate increase in tax revenue.

State law says that if counties do not renew a Williamson
Act contract and the landowner protests, the county cannot raise property taxes
for at least four years, he said.

Perhaps the primary reason county leaders do not intend
on doing away with Williamson Act subventions is because the county’s
reimbursement from the state amounts to only one-half percent of all property
taxes, a miniscule loss compared to amounts incurred by smaller rural counties,
Gamper said.

“Santa Barbara County takes in about $112 million in
property taxes because of expensive development,” Gamper
said. “So $600,000 isn’t a hard blow. But Glenn County was cut off at the knees
when they lost almost a million out of a total property tax take of $5 million.
That’s a 20 percent loss.”